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Inside Washington (03/05/2008)

* WASHINGTON (3/6/08)—House Financial Services Committee Chairman Barney Frank (D-Mass.) is pushing a draft bill that would protect servicers from lawsuits if they choose to modify a borrower’s mortgage to prevent foreclosure. The protection would be applicable to loan workouts for up to five years unless the borrowers refinances or sells. The borrower would not be subject to other fees or points … * WASHINGTON (3/6/08)—Regulators signaled that they could be open to a Democratic contingency plan to help with the housing crisis, but could not confirm whether they will actually need it (American Banker March 5). Federal Deposit Insurance Corp. Chairman Sheila Bair recognized that the industry should be open to all options, but warned that a government intervention could risk a moral hazard. Comptroller of the Currency John Dugan disagreed, stating that the government may not need to intervene. Federal Reserve Board Vice Chairman Donald Kohn and Office of Thrift Supervision Director John Reich said adding onto existing programs would be better than making new ones … * WASHINGTON (3/6/08)—Interagency guidelines for remote deposit service could be released by federal regulators in a few months, triggering concern from bankers who worry that the oversight could create a chilling effect on the technology that has helped many community financial institutions bring in customers outside of their local areas (American Banker March 5). A survey conducted by the American Bankers Association (ABA) Banking Journal indicated that 37.5% provide remote deposit. ABA’s Douglas Johnson, who is vice president of risk management policy, said it’s uncertain that the guidance would slow remote deposit growth and said financial institutions should be able to live with the guidance … * WASHINGTON (3/6/08)—U.S. Treasury Assistant for Economic Policy Phillip Swagel will hold a media briefing today on the state of the U.S. economy. The event is open to the media …